Patient Capital Management, a value investing firm, released its “Patient Capital Opportunity Equity Strategy” third quarter 2023 investor letter. A copy of the same can be downloaded here. During the quarter the strategy returned -6.0% net of fees compared to the S&P 500’s -3.3% return. As the quarter demonstrated, the markets are uncertain. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Patient Capital Management highlighted stocks like CVS Health Corporation (NYSE:CVS) in the third quarter 2023 investor letter. Headquartered in Woonsocket, Rhode Island, CVS Health Corporation (NYSE:CVS) is a health services provider that operates through Health Care Benefits, Pharmacy Services, and Retail/LTC segments. On November 1, 2023, CVS Health Corporation (NYSE:CVS) stock closed at $68.73 per share. One-month return of CVS Health Corporation (NYSE:CVS) was -1.46%, and its shares lost 29.72% of their value over the last 52 weeks. CVS Health Corporation (NYSE:CVS) has a market capitalization of $88.449 billion.
Patient Capital Management made the following comment about CVS Health Corporation (NYSE:CVS) in its Q3 2023 investor letter:
“Our largest new position was CVS Health Corporation (NYSE:CVS). We owned CVS in 2021 through call options, which provided a handsome return. We sold it when it reached our assessment of intrinsic value. In the first half of the year, the stock traded down nearly 40% from its highs. CVS is valued like a pharmacy business in secular decline, while its strategy and assets are far better. CVS owns a healthcare benefits business (Aetna) and a pharmacy-benefits manager (Caremark). It recently acquired Signify Health and Oak Street Health, entering the In-Home Evaluations and primary care spaces enhancing the company’s ability to offer comprehensive healthcare services as we transition to a system more focused on value-based care. Short-term headwinds, such as an unwind from COVID, some unfavorable health care developments and negative headlines from PBM contract losses, weighed on the price. The company is again significantly undervalued, with a trough-level 8.2x P/E multiple well below peers’ 12.2x, with a 3.5% dividend yield. We saw an opportunity to diversify the portfolio with a stable company with a promising strategy and group of assets at an attractive price.”
An independent distributor in their pharmacy with a range of biopharmaceutical products on display.
CVS Health Corporation (NYSE:CVS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 66 hedge fund portfolios held CVS Health Corporation (NYSE:CVS) at the end of the second quarter, which was 77 in the previous quarter.
We discussed CVS Health Corporation (NYSE:CVS) in another article and shared the list of best pharma stocks to buy. In addition, please check out our hedge fund investor letters Q3 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.